The  Difficulties Surrounding China’s Accession to the World Trade Organisation,  

and  the Likely Impacts on China’s Economy in Post-WTO China.  

Table Of  Contents  

1  INTRODUCTION  1

2  CHINA’S FIRST ATTEMPTS TO ENTER THE WTO  3

3  PROLONGED DIFFICULTIES  4

4  FINAL WTO ACCESSION  6

5  BENEFITS AND DISADVANTAGES OF WTO MEMBERSHIP  7

5.1  EXPECTED BENEFITS FROM WTO MEMBERSHIP  7

5.2  EXPECTED DISADVANTAGES FROM WTO MEMBERSHIP  9

6  FUTURE OUTLOOK  10

7  CONCLUSION  12

BIBLIOGRAPHY   14

Ben  Beiske, January  2003

The Difficulties Surrounding China’s Accession to the World Trade Organisation,

and the Likely Impacts on China’s Economy in Post-WTO China.

1 Introduction

What were the difficulties surrounding China’s accession to the World Trade Organisation (WTO)? Why has it taken the People’s Republic of China (PRC) over 15 years to join? What are the expected benefits and disadvantages of joining? What changes is WTO membership likely to bring to China’s economy in the future?

These are the question this paper aims to address on the following pages. WTO accession by China is often seen as the most significant event about China in the last decade, even ahead of the Taiwan Independence issue, which continues to penetrate world news periodically. Since the end of the Cultural Revolution in 1978, China has been on a course of economic reform. Today, Chinese are richer than ever before in history, with the country itself having experienced extended periods of extraordinary growth, even throughout recent events such as the Asian crisis (Morck and Yeung 2000).

Along side the other international organisations in operation today, the WTO has played an important role in liberalising and regulating global markets (WTO Secretariat 2000). It covers numerous aspects of economic and trade globalisation such as commodities trade, services trade, investments relating to trade, intellectual property rights relating to trade, mechanisms on trade policy deliberation and dispute settlement, transparency of regulations, and sustainable development (Linggguang 2001). Wallach (1999) rightly expects that the WTO will ‘continue to advance global liberisation through multilateral rules’.

Entering the WTO is widely regarded as being of significant importance for China, both in terms of gaining access to foreign markets, but also to use firm WTO rules to fight off economic entrenchment. Further, Woo (2001) sees the country’s marketisation and international integration ‘below the optimal degree’. With WTO membership, China can rightfully expect to become, once again, a full and respected member of the international trading arena, much in the same way as the country made its political reappearance on the international stage through its UN membership in 1972 (Morck and Yeung 2000).

Ben Beiske, January 2003 Page 1 of 15

The Difficulties Surrounding China’s Accession to the World Trade Organisation,

and the Likely Impacts on China’s Economy in Post-WTO China.

The effects of Chinese WTO membership are expected to be profound and widespread, both on the Chinese economy, but also on its trading partners. This paper will focus on aspects affecting the Chinese economy, highlighting the main advantages of membership, but also reporting on some of the expected and perceived negative impacts.

Specifically, this report will highlight China’s first attempts to join the WTO more than 15 years ago in chapter two. Chapter three will focus on the main areas of difficulty surrounding WTO accession, while chapter four will comment on the final accession in December 2001. The expected economic advantages and disadvantages for China will be discussed in chapter five; finally, chapter six will offer a brief future outlook for China, again mainly from an economic perspective.

Ben Beiske, January 2003 Page 2 of 15